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Establishment of Joint-Stock Company in Turkey

How many days is a joint-stock company established? What information is required?

Establishment process of joint-stock company in Turkey takes approximately 5 business days. Most of the transactions are carried out by the power of attorney received from the shareholders for the establishment of the company. Before starting the establishment of the company, the information required for the draft of the articles of association is obtained from the company shareholders. In order to prepare the articles of association of the company, it is necessary to determine the corporate name, shareholders, address, capital, share rates of the company and members of the Board of Directors.

 

What should the number of shareholders be in a joint-stock company?

There is no number restriction for Joint-Stock Companies. Other Companies can be shareholders of Joint-Stock Company. If the Joint Stock Company has only one shareholder, it can be a real or legal person.

 

How to choose the Board of Directors of Joint-Stock Company?

If the Joint-Stock Company has more than one shareholder, at least one of them must be a member of the Board of Directors with unlimited signature authority. Member of Board of Directors can be appointed externally to the company. The members of the Board of Directors of the Joint-Stock Company can be elected for maximum 3 (three) years. At the end of the duration, the same members or some of them can be re-elected.

 

Can a Joint-Stock Company be established indefinitely?

Joint-Stock Companies can be established indefinitely. It can be set duration for the company, if requested. At the end of the duration, the relevant article of the Articles of Association can be extended by amending or changed indefinitely.

 

How much should the Capital Amount of Joint-Stock Company be?

The capital of Joint-Stock Companies must be at least TRY 50.000. Capital shares can be determined freely. For example, a share may be TRY 1 TL 1 Kurus. During the establishment of joint stock companies, it is obligatory to block 3/4 of the capital to the bank. With the establishment of the company, the blocked money can be taken from the bank and used freely for company expenses. The remaining amount must be paid to the company within 24 months of the establishment of the company. The capital amount paid to the company by the shareholders of the company can be freely used by the company.

 

Can legal entities be shareholder in Joint-Stock Companies?

Legal entities can be shareholders along with real persons. Legal entities can be member of Board of Directors in Joint-Stock Companies where they are shareholders. In this case, the legal entity must appoint a real person to represent it.

 

In which institutions are transactions for the Joint-Stock Company be carried out?

After the draft of the articles of association of the Joint-Stock Company is completed, establishment procedures are started. Files in MERSİS (Central Registry System), Trade Registry Office, Chamber of Commerce, Notary, Tax Office and Social Security Institution (SSI) are opened respectively.

 

When is the invoice for the Joint-Stock Company printed?

After the opening of files for the Joint-Stock Company in the aforementioned institutions, if the invoice will be printed or electronic invoice will be used for the company according to the obligatory conditions written in the legal regulations, the activation procedures are completed and the company commences its commercial activities.

 

Which registration documents can be obtained for the Joint-Stock Company?

Following the completion of the establishment of the Joint-Stock Company, documents can be obtained from the Trade Registry Office, Chamber of Commerce, Tax Office and Social Security Institutions where the company is registered. Some of these documents are Trade Registry Gazette, Trade Registry Certification, Chamber of Commerce Registration Form, Activity Certificate, Tax Signboard, Social Security Workplace Register number. In addition to these, Joint-Stock Companies can register to collecting societies or organizations optionally or necessarily, according to their field of activity. For example, the company which wants to export goods, should register to the Exporters’ Association before export.

 

Cem GENİŞ
KarenAudit.com
info@karenaudit.com

+90 216 – 441 90 45

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Establishment of Limited Liability Company in Turkey

How many days is a limited liability company established? What information is required?

Establishment process of limited liability company in Turkey, takes approximately 5 business days. Most of the transactions are carried out by the power of attorney received from the shareholders for the establishment of the company. Before starting the establishment of the company, the information required for the draft of the articles of association is obtained from the company shareholders. In order to prepare the articles of association of the company, it is necessary to determine the corporate name, shareholders, address, capital, share rates of the company and authorized signatory directors.

 

What should the number of shareholders be in a limited liability company?

Limited Liability Companies can be established with at least one, at most fifty shareholders. Companies can also be shareholders. If the company has only one shareholder, it may be a real person or a legal person.

 

How to choose the Director of Limited Liability Company?

If the Limited Liability Company has more than one shareholder, at least one of the shareholders must be a director with unlimited authority. Directors can be appointed externally to the company. Director of Limited Liability Company can be appointed without duration limit.

 

Can a Limited Liability Company be established indefinitely?

Limited Liability Companies can be established indefinitely. It can be set duration for the company, if requested. At the end of the duration, the relevant article of the Articles of Association can be extended by amending or changed indefinitely.

 

How much should the Capital Amount of Limited Liability Company be?

The capital of limited liability companies must be at least TRY 10.000. The minimum share of capital should be determined as TRY 25 and its multiples. There is no obligation to block capital in the bank during the establishment of company. The stipulated capital must be paid to the company within 24 months of the establishment of the company. The amount of capital paid to the company by the shareholders of the company can be freely used by the company.

 

Can legal entities be shareholder in Limited Liability Companies?

Legal entities can be shareholders along with real persons. Legal entities can be directors in Limited Companies where they are shareholders. In this case, the legal entity must appoint a real person to represent it.

 

In which institutions are transactions for the Limited Liability Company be carried out?

After the draft of the articles of association of the Limited Liability Company is completed with this information, establishment procedures are started. Files in MERSİS (Central Registry System), Trade Registry Office, Chamber of Commerce, Notary, Tax Office and Social Security Institution (SSI) are opened respectively.

 

When is the invoice for the Limited Company printed?

After the opening of files for the Limited Liability Company in the aforementioned institutions, if the invoice will be printed or electronic invoice will be used for the company according to the obligatory conditions written in the legal regulations, the activation procedures are completed and the company commences its commercial activities.

 

Which registration documents can be obtained for the Limited Liability Company?

Following the completion of the establishment of the Limited Liability Company, documents can be obtained from the Trade Registry Office, Chamber of Commerce, Chamber of Industry, Tax Office and Social Security Institutions where the company is registered. Some of these documents are Trade Registry Gazette, Trade Registry Certification, Chamber of Commerce Registration Form, Activity Certificate, Tax Signboard, Social Security Workplace Register number. In addition to these, Limited Liability Companies can register to collecting societies or organizations optionally or necessarily, according to their field of activity. For example, the company which wants to export goods, should register to the Exporters’ Association before export.

 

Cem GENİŞ
KarenAudit.com
info@karenaudit.com
+90 216 – 441 90 45

 

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Q&A and Summary Table about e-Archive Invoice Obligation

1- What is invoice? How many copies are issued?

According to the provisions of the Law, the invoice is issued in at least two copies in paper and the first copy (original) is given to the customer and the second copy is the document kept in paper by the taxpayers according to the preservation and submission provisions of the same Law.

 

2- Will the e-Archive invoice be issued to the customer by e-mail or as printout?

Taxpayers (or non-taxpayers) who have been granted permission to be included in the e-Archive invoice application by the Revenue Administration with the Communique No. 509 of Tax Procedure Law  (Official Gazette dated 19.10.2019, numbered 30923) generate invoices online to be issued to users who are NOT registered to e-Invoice application, as e-Archive Invoice. Upon the request of the recipient, it forwards E-Archive Invoice in paper or electronic form and keeps and presents the copy of the issuer online.

 

3- What is the criterion for the separation of the original and copy of the e-Archive Invoice?

The e-Archive invoice, which is generated in electronic form and is sent to recipient (customer) as printout or in electronic form, is the original of the invoice, and electronic version of the invoice kept by the person (supplier) who issued, is duplicate.

 

4- Which type of documents will taxpayers of e-Archive Invoice issue to taxpayers of e-INVOICE?

The taxpayers registered to the e-Archive Invoice application are obliged to issue the invoice as e-INVOICE in the sales of goods and services performed to the taxpayers registered to the e-INVOICE application and to issue as e-Archive Invoice in the sales of goods and services performed to the taxpayers who are not registered to the e-INVOICE application and to the non-taxpayers.

 

5- When will the OBLIGATION of e-Archive Invoice application START for the taxpayers registered to e-INVOICE application?

Taxpayers who ARE OBLIGED TO be included in the e-INVOICE application and taxpayers who have registered to e-INVOICE application WILLFULLY (except for the taxpayers issuing other documents  standing for invoices as required by their activities) until the publication of the Communique No. 509 of Tax Procedure Law  (Official Gazette dated 19.10.2019 and numbered 30923) until January 1, 2020, have to register to the e-Archive INVOICE.

 

6- Are intermediary service providers, persons publishing announcements on the internet and intermediary internet advertising service obliged to register to e-Archive Invoice?

– Real or legal person intermediary service providers who provide electronic commerce environment for the realization of the economic and commercial activities of other companies defined in the Law on the Regulation of Electronic Commerce on the internet for the purchase, sale, rental or distribution of goods and services; owners or operators of websites that publish advertisements for the sale or rental of motor vehicles, and intermediary internet advertisers engaged in the publication of advertisements on the internet are obliged to complete their applications and preparations for the actual transition to E-Archive Invoice application until January 1, 2020 (the taxpayers who will start to engage in the works mentioned in this paragraph starting from 2020 and subsequent accounting periods within 3 months from the commencement date).

In this way, the invoices to be issued by the intermediary service providers, intermediary internet advertisers and publishers on the internet as from the specified dates, must be issued as e-INVOICE or e-Archive Invoice EXCEPT FROM the cases specified in the “V.7.” And “VIII.” sections of the Communique No. 509 of Tax Procedure Law .

 

7- Pay attention to the invoice limits of TRY Five Thousand and TRY Thirty Thousand!

If the total amount of invoices issued by taxpayers who do not register to e-Archive Invoice application, as from January 1, 2020 exceeds TRY 30.000 INCLUDING TAXES (VAT + Special Consumption Tax and other) (total amount of invoices to be issued for taxpayers exceeds TRY 5.000 INCLUDING TAXES), they must be issued as an e-Archive Invoice through the e-DOCUMENT portal presented by the Revenue Administration, except from the cases specified in the “V.7.” And “VIII.” sections of the Communique No. 509 of Tax Procedure Law.

In the event that the invoices are issued or received as paper instead of e-Archive Invoice, the penal clause stipulated in Article 353 of the Tax Procedure Law shall be applied separately for each paper invoice issued or received for the receiver having tax liability other than the person issued invoice or final consumer, except from the cases specified in the “V.7.” And “VIII.” sections of the Communique No. 509 of Tax Procedure Law.

 

8- If both parties are taxpayers of e-INVOICE, e-INVOICE will be issued.

If both the seller and the recipient are registered users in the e-INVOICE application, all invoices issued between them must be e-INVOICE.

 

9- Will invoices issued to the same people on the same day be evaluated collectively?

Invoices issued to the same people on the same day will be evaluated collectively and if the total amount of the invoices including tax exceeds the specified amount, the invoices must be issued and received as e-Archive Invoice.

 

10- Obligation can be imposed with the initiative of Revenue Administration

The Revenue Administration is entitled to impose obligation to the taxpayers or taxpayer groups which are determined by Revenue Administration that their compliance rate to tax is risky or low, as a result of analysis and examinations, by submitting a written notification and giving at least 3 months for transition preparations, without considering their activity, sector and turnovers.

 

11- Points related to e-Archive Invoices to be issued within the scope of e-Commerce

Those who are registered to the e-Archive Invoice application and SELL GOODS AND SERVICES OVER THE INTERNET are obliged to submit e-Archive Invoices regarding their sales in electronic environment. In these sales, e-Archive Invoice printout, Cash Register Devices’ invoice, information receipt or delivery note must be submitted with the goods.

 

12- What is the required information that must be in e-Archive Invoice issued for e-Commerce?

The following information must be included in the e-Archive Invoices to be issued by the taxpayers registered to the e-Archive Invoice application regarding the sale of goods and services within the scope of electronic commerce and the statement of “This sale has been made through the internet.” must be included on the invoice.

1- Web address where the sale has been made

2- Payment method

3- Payment date

4- Name-surname, title and Tax Identification Number/Republic of Turkey ID Number of the shipper of goods

5- The date when the goods to be sold are sent or the service is carried out

6- In the return section: there must be name, surname, address, signature of the person who returned the goods and also type, amount, unit price and amount of the returned goods

 

13- What should the buyer do, if s/he wants to return goods sold under e-Commerce?

If the customer wants to return the goods, s/he takes printout of the invoice delivered to her/him electronically and sends it back to the seller along with the goods by filling and signing the “return section” of the invoice. This document, which is sent back to the seller, replaces the note of expenses issued by the seller.

 

14- Is printout necessary for e-INVOICE sales made within the scope of e-Commerce?

Those who is registered to e-Archive Invoice and sell goods through internet to users registered to e-Invoice application, will include the above-mentioned information in the e-INVOICE, except the 6th article. In such sales made by the taxpayers, e-INVOICE printout replacing waybill, Cash Register Devices’ invoice, information receipt or delivery note must be submitted with the goods.

 

14- What is the PENALTY not to apply e-Archive Invoice?

The penal provisions stipulated in the law shall apply to the taxpayers who do not register to the e-Archive Invoice application within the certain period even though there is obligation, and the taxpayers (including those who issue and receive paper invoices and are specified in subparagraph 1 and 5, paragraph 1, Article 232 of Tax Procedure Law), who do not issue and receive the invoice as e-Archive Invoice except from the cases specified in the “V.7.” And “VIII.” sections of the Communique No. 509 of Tax Procedure Law.

 

SUMMARY TABLE

Application Taxpayer Groups included in the Scope Obligation Date
 

 

e-Invoice

Taxpayers with gross sales revenue of TRY 5 Million (or gross revenue from sales) or more in 2018 or subsequent accounting periods  

 

01.07.2020

 

 

e-Invoice

Taxpayers obtaining license (including dealership license) from Energy Market Regulatory Authority (EMRA) for their activities such as manufacturing, import, delivery, etc. of the goods in the Special Consumption Tax I  

 

01.07.2020

 

e-Invoice

Manufacture, construct and/or import of goods in the list (III) attached to the Law on Special Consumption Tax  

01.07.2020

 

 

e-Invoice

Internet advertising service intermediaries that act as intermediaries for the purchase, sale, rental or distribution of goods or services  

 

01.01.2020

 

 

 

e-Invoice

Taxpayers engaged in the trade of vegetables and fruits as brokers or merchants, pursuant to the provisions of the Law on the Regulation of the Trade of Vegetables and Fruits and Other Goods with Sufficient Depth of Supply and Demand  

 

 

01.01.2020

e-Archive Invoice Taxpayers already registered to e-Invoice Application 01.01.2020
 

 

e-Archive Invoice

Obligation to register in e-Archive Invoice Application for Intermediary Service Providers, Publisher on Internet and Intermediary Internet Advertisers  

 

01.01.2020

 

 

e-Archive Invoice

Other Invoices that are required to be issued as e-Archive Invoices (TRY 5,000 for taxpayers, TRY 30,000 and above for final consumers)  

 

01.01.2020

 

 

e-Waybill

Taxpayers obtaining license (including dealership license) from Energy Market Regulatory Authority (EMRA) for their activities such as manufacturing, import, delivery, etc. of the goods in the Special Consumption Tax I  

 

01.07.2020

 

e-Waybill

Manufacture, construct and/or import of goods in the list (III) attached to the Law on Special Consumption Tax  

01.07.2020

 

 

e-Waybill

Holders of operating license/certificate issued under the Mining Law and natural and legal person taxpayers engaged in mining production regarding the contract concluded with the holders of operating license/certificate  

 

 

01.07.2020

 

e-Waybill

The taxpayers engaged in the production of sugar, which is defined in the paragraph (e) of Article 2 of the Sugar Law.  

01.07.2020

 

 

e-Waybill

The taxpayers registered to the e-Invoice application, engaged in the production, import or export of iron and steel (GTİP 72) and iron or steel goods (GTİP 73)  

 

01.07.2020

 

 

e-Waybill

Users registered to the Fertilizer Tracking System established by the Ministry of Agriculture and Forestry to record production and consumption of fertilizer.  

 

01.07.2020

 

 

e-Waybill

Taxpayers registered to e-Invoice application and its gross sales revenue (or sales and gross business revenue) of 2018 or subsequent accounting periods are TRY 25 Million and above  

 

01.07.2020

 

 

 

e-Waybill

Taxpayers engaged in the trade of vegetables and fruits as brokers or merchants, pursuant to the provisions of the Law on the Regulation of the Trade of Vegetables and Fruits and Other Goods with Sufficient Depth of Supply and Demand  

 

 

01.01.2020

e-Self-Employed Invoice Self-employed persons who are not exempt from tax 01.06.2020

 

e-Producer Receipt Taxpayers who are required to register to the e-Invoice application, and are obliged to issue a producer receipt as required for their activities as well  

 

01.07.2020

 

 

e- e-Producer Receipt

Taxpayers engaged in the trade of vegetables and fruits as brokers or merchants, pursuant to the provisions of the Law on the Regulation of the Trade of Vegetables and Fruits and Other Goods with Sufficient Depth of Supply and Demand  

 

 

01.01.2020

e-Ticket Taxpayers engaged in Road and Maritime Passenger Transportation 01.01.2021
e-Ticket Cinema Business 01.07.2020

 

 

Ali KARAKUŞ
Istanbul,
November 11, 2019

——————————————————-

Sources:

1- Communique No. 509 of Tax Procedure Law No. 213 – Official Gazette dated 19.10.2019 and numbered 30923

2- Articles 229, 230, 231, 232, 242, 353 of Tax Procedure Law No. 213

3- e-Document portal of Revenue Administration of Republic of Turkey

 

 

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Will we calculate VAT in the invoice issued for a commercial film shot in Turkey and to be sold abroad?  Can we issue an invoice in foreign currency?

Will we calculate VAT in the invoice issued for a commercial film shot in Turkey and to be sold abroad?  Can we issue an invoice in foreign currency?

 We shoot a commercial film in a production company. We will shoot it in Turkey. However, it will be invoiced abroad, and the film will be televised there.

In this case, while the invoice is issued;

1- Will it be subjected to VAT? Will we show 18% VAT in the invoice?

2- Will the invoice be issued as foreign currency? Will we write the amount of TRY or amount of exchange and currency in the remarks part by issuing an invoice of TRY? 

1- The sale is in the scope of service export. The VAT is not calculated.

2- You will issue the invoice in foreign currency. It is not necessary to write currency in an invoice. Accounting record is kept as TRY.


Source: İSMMMO
Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither Karen Audit nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.


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Can I recognise the stamp duty as expense without its invoice? It was invoiced to us by some public authority.

We draw up invoices for public authorities. These authorities cut 0,0825 on the invoices for stamp duty and deduct that amount when making us payment. Even though we always ask for an invoive on this cut, it causes a problem. Is it possible to recognise this cut as an expense? What should we do?

 

It is beneficial to prepare and save a document explaining the stamp duty cut. It will be a proof if a conflict situation occurs in the future. You can write cut as an expense.  

 

 

 


Source: İSMMMO
Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither Karen Audit nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.


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How should I register the scrapping bonus on the invoice of a new passanger car?

My taxpayer bought a new passanger car. They drew out an invoice by counting the VAT and Special Consumption Tax (SCT). However, ‘’…your junk car with plate received the SCT discount and the SCT won’t be applied’’ is stated on the invoice. We don’t own such a ‘junk’ car, so how should I keep the accounting record?

 

If you don’t own a junk car, TRY 10.000 shall be reduced from the calculated SCT and then rest of the amount shall be written as expense.

 

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Is the VAT rate of a guitar course 8%?

There is a taxpayer who sells guitars online and gives guitar education in his music school. What is the VAT rate he is going to write when drawing out an invoice on the guitar education?

 

If the education is under the governance of the Ministry of National Education, the VAT rate must be 8%. If not, it must be 18%.


Source: İSMMMO
Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither Karen Audit nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.


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What steps to follow if the exports which are not accepted by the buyer are not returned physically?

There is an export company selling mines. During the delivery, some goods were not accepted by the receiver but they also can not be returned. What kind of a document the receiver can draft to reduce its debt to us, which would also reduce our receivables?
(18.12.2018)

There is nothing to do for the goods that are not returned. There should be a legal transaction for the export price.

 


Source :ISMMMO
Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither KarenAudit nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.


 

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What are the obligations of board members of an incorporated company for tax debt?

…There is an INCORPORATED company that has a capital of TRY 900.000 and is taken over in July, 2015. TRY 899.999 of this capital belongs to a partner and TRY 1 belongs to the other. The company hasn’t operated since 2015. The principal partner has power of attorney. The shareholder is the vice chairman but he doesn’t have power of attorney. They have debts to the Tax Authority and SSI from previous period. Board of directors had to be renewed 3 years ago. What are the rates of governments debts for these partners? If the shareholder is a partner on paper and wants to transder his shares to the principal partners, what steps he should follow? What will be the situation of debt payment if the partnership ends?
(18.12.2018)

 

The partners are responsible for the capital they committed to the company. So the authorized member is responsible for representation. We can pay regard to the principal of joint liability within this regard. The responsibilities of the shareholder are limited, so it is possible for the him to leave the company by transferring his shares. My advice is to make the sale in a notary, take the decision of becoming a single-shareholder joint stock company  and register it. Termination of the partnership does not end the board membership. So the board should make a decision and establish a new board to exculpate his responsibilities.

 


Source :ISMMMO
Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither KarenAudit nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.


 

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Is someone who took over the share of a company required to apply to Tax Authority for E-Tebligat again?

…We took over all the shares of a limited company which has a single partner. Shares are also taken over by a single person, meaning that the company passed in to other hand. Are we supposed to apply to the Tax Authority for a new E-tebligat? If so, is there a specific time period for it?
(18.12.2018)

 

Yes. The Tax Authority will make the necessary changes and procedures. The changes regarding the liability are supposed to be made within a month.

 


Source :ISMMMO
Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither KarenAudit nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.


 

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